In the human population, mutations in Rx have been found to result in anophthalmia. Exactly how Rx deficiency results in this congenital condition is unknown. Therefore we are generating an animal model of this condition by inactivating our conditional Rx allele in the developing embryo using various tissue-specific Cre lines. This work will potentially provide insight into the role of this genetic pathway in maintaining retinal stem cells. Rx is target of FGF8 signaling in the developing eye. It is first expressed in mouse embryos at E7.5 in the presumptive forebrain and becomes restricted to the developing retina, posterior pituitary and hypothalamus. Deletion of the Rx gene revealed that it is required for the formation of these structures, as its loss causes anophthalmia and ventral neural tube defects. To determine the role of Rx later in eye development and in adult retina physiology, we have produced mice that carry a conditional Rx allele so that normal Rx function can be disrupted by Cre-mediated recombination. Inactivation of Rx in the developing optic vesicle causes two defects: the lens doesn't form and the optic vesicle forms retinal pigmented epithelium at the expense of neural retina. Our data supports a model in which Rx is required for Bmp4 and Fgf8/15 expression, which in turn is required for proper development of the eye.